Correlation Between Global Net and Atalaya Mining
Can any of the company-specific risk be diversified away by investing in both Global Net and Atalaya Mining at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Global Net and Atalaya Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Net Lease and Atalaya Mining, you can compare the effects of market volatilities on Global Net and Atalaya Mining and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Global Net with a short position of Atalaya Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Net and Atalaya Mining.
Diversification Opportunities for Global Net and Atalaya Mining
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and Atalaya is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Global Net Lease and Atalaya Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atalaya Mining and Global Net is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Global Net Lease are associated (or correlated) with Atalaya Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atalaya Mining has no effect on the direction of Global Net i.e., Global Net and Atalaya Mining go up and down completely randomly.
Pair Corralation between Global Net and Atalaya Mining
Assuming the 90 days trading horizon Global Net Lease is expected to generate 2.28 times more return on investment than Atalaya Mining. However, Global Net is 2.28 times more volatile than Atalaya Mining. It trades about 0.01 of its potential returns per unit of risk. Atalaya Mining is currently generating about 0.02 per unit of risk. If you would invest 1,106 in Global Net Lease on October 11, 2024 and sell it today you would lose (366.00) from holding Global Net Lease or give up 33.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.38% |
| Values | Daily Returns |
Global Net Lease vs. Atalaya Mining
Performance |
| Timeline |
| Global Net Lease |
| Atalaya Mining |
Global Net and Atalaya Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Net and Atalaya Mining
The main advantage of trading using opposite Global Net and Atalaya Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Net position performs unexpectedly, Atalaya Mining can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Atalaya Mining will offset losses from the drop in Atalaya Mining's long position.| Global Net vs. Jupiter Fund Management | Global Net vs. Gamma Communications PLC | Global Net vs. Spirent Communications plc | Global Net vs. Tatton Asset Management |
| Atalaya Mining vs. Wheaton Precious Metals | Atalaya Mining vs. Hochschild Mining plc | Atalaya Mining vs. Coeur Mining | Atalaya Mining vs. Golden Metal Resources |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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